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2012 (11) TMI 321 - AT - Income TaxGuarantee commission - CIT(A) deleted the addition - Held that:- As the directors have been paid guarantee commission to compensate them from the risk assumed by them in standing as guarantor for the bank loan taken by the assessee-company. It was also the case of the assessee that the bank has necessitated on such personal guarantee and accordingly personal guarantee was needed, thus CIT(A)'s order of deleting addition is confirmed - in favour of assessee. Foreign travel expenditure - CIT(A) deleted the addition - Held that:- Finding on fact has been given by CIT(A) that the assessee has furnished the purpose of the foreign visits of the Directors and the tour report has been submitted on their return which was found to be for the purpose of the business of the assessee - Since in assessee’s own case on last two occasions the Respected Coordinate Benches have taken a consistent view in assessee’s favour, therefore in the light of the ratio laid down therein for this year the view taken by CIT(A) is to be affirmed - in favour of assessee. Disallowance of warranty obligation - Held that:- Since the Tribunal is taking a consistent view that the warrant obligation happened to be a business liability and made on scientific basis as per the recurrence of the after sales obligation the amount was debited to P&L Account, therefore in the like manner for the year under consideration, we hereby consider it proper to affirm the factual as also legal finding of CIT(A) - in favour of assessee. Claim of bad debts - Disallowance of interest on inter-corporate deposits - CIT(A) allowed the claim - Held that:- The assessee has yet to place on record that the borrowers have gone under liquidation, that even after the best efforts of the assessee the impugned amount could not be recovered from them and that the Civil Suites filed have not resulted into any gain, then only the assessee can be allowed such claim - restore this issue back to the stage of the AO, so that the assessee can place on record the fate of the Court proceedings to establish the genuineness of the failure on the part of the borrowers - in favour of Revenue for statistical purposes.
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